Canada ranks 28th of 38 OECD countries on individual taxes ahead of the November 5 budget
Canada ranks 28th of 38 OECD countries on individual taxes and 15th on overall tax competitiveness.
Those scores, 72.2 out of 100 against 72.3 a year earlier, come from the Tax Foundation’s 2026 International Tax Competitiveness Index.
Laurent Ferreira, chief executive of National Bank of Canada, told the Canadian Club Toronto on Wednesday that Ottawa should discard the tax code rather than amend it.
“A review or an overhaul will not work,” Ferreira said in prepared remarks reported by Bloomberg. “It needs to be scrapped.”
Ferreira asked the federal government to hire a small team of experts to write a new code with the “goal of becoming the simplest, most efficient and most competitive tax jurisdiction of all developed countries,” the Financial Post reported from the speech.
The Globe and Mail reported that he proposed the team finish the work within a year.
“The complexity of our tax code is a burden and a real cost, especially for small businesses that often lack the resources to navigate all the rules,” Ferreira said, in remarks carried by the Financial Post. “We need a tax code that creates the right conditions to attract capital and talent, generate jobs and build wealth for all Canadians.”
The Tax Foundation reported that Ottawa announced the Productivity Mega Deduction on September 15, making full expensing for machinery and patent rights permanent and extending it to a larger share of assets.
The government also prioritized advance income tax rulings for investments of $1bn or more, per the Financial Post, a threshold Bloomberg valued at about US$711m.
“I love the action of our government, and individual measures like these are necessary, however, they can only go so far,” Ferreira said, the Financial Post reported.
Within the 2026 index, Canada places 17th on corporate taxes, eighth on consumption taxes, 25th on property taxes, and 28th on cross-border tax rules.
The Tax Foundation notes the September expensing changes fell after its cut-off date.
In its release on the index, the Canadian Taxpayers Federation said Canada sits 28th on individual taxes and 17th on business taxes while the United States ranks 17th and eighth on those measures.
“The report shows Canada falling behind the United States on business and income taxes and that should be a real wake-up call for our politicians,” said Franco Terrazzano, federal director of the Ottawa-based group.
Eighty-seven percent of Canadian business leaders want a comprehensive review of the tax system, KPMG in Canada reported from its 2026 Federal Budget Survey of 346 business owners and decision-makers, conducted September 22 to October 2.
The same survey found 85 percent want the system simplified and 82 percent want it made more competitive.
“While tax incentives can help drive specific outcomes, they are no substitute for comprehensive tax reform that improves competitiveness and reinvigorates the economy,” said Lachlan Wolfers, national leader of KPMG Law, in the firm’s release.
CPA Ontario is seeking a royal commission on taxation, arguing in its 2026 federal pre-budget submission that there has been no comprehensive review since the 1960s.
It recommends a revenue-neutral shift away from taxes on income and investment and toward consumption taxes.
Finance Minister François-Philippe Champagne will table the 2026 federal budget on November 5, CBC News reported, the second under Prime Minister Mark Carney.
Ferreira urged radical tax cuts in September 2025 and criticized the planned increase to the capital gains inclusion rate in April 2024, a measure cancelled after Carney took office in 2025, according to Bloomberg.
